Russian jewellers look to innovation and palladium to keep sales momentum up

Russia's jewellery business is facing tougher times, but the crisis is the best time for promoting innovation in the business – that’s the message from major jewellery producers meeting in Moscow.

Despite the financial gloom, Russia remains one of the largest and fastest-growing high-end jewellery markets in the world.

But the domestic jewellery business could be doing better, if it wasn't hamstrung by tariffs of up to 41 percent according to Alex Popov, President, of the Moscow Diamond Bourse.

“The polishing industry is down, the jewellery industry is down, and, as a result of this, the retail industry is down. And the import industry is in big trouble because of these taxes, and the enormous bureaucratic obstacles to business.”

But neither tariffs or the crisis are stopping foreign investors from launching new projects in Russia.  One of India’s leading manufacturers of gold, silver and diamonds has ambitious plans for multi-million dollar investment in the country according to Shah Hemant, COO of Derawala Jewellery Industries.

“What we’re looking for is to form the shortest channel of business between Indian manufacturers, Indian producers of diamonds, and the Russian jewelers right up to the consumer level.”
Some industry players believe the crisis can also be a good environment for promoting new products. For example, Russia’s Norilsk Nickel – the world’s leading nickel producer – is promoting palladium as a new precious metal for jewellery, according to Anton Berlin, Head of Market Analysis and Development at Norilsk Nickel .

“Palladium is a nobel metal which belongs to the platinum group and has similar properties. It’s ten times rarer than gold and due to its relatively small market it’s cheaper.”

Though not yet popular globally, the palladium jewellery market has already seen significant growth in China – it’s now a matter of time and marketing.

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